A current ELD mandate waiver which postponed the measure for trucks carrying produce and other ag products ends March 18.

In a letter submitted Feb. 20, the United Fresh Produce Association, Western Growers, the National Potato Council, the U.S Apple Association and more than 20 other produce groups said a combination of factors have driven up transportation costs.

“With the electronic logging device (ELD) mandate, driver shortages, and other issues, there have been considerable increases in transportation costs for fresh produce causing devastating effects on our industry,” the letter said. “We are hearing from many of our members across multiple commodities and sectors throughout the country that shippers are having to pay two or three times, occasionally more, the normal rate for transporting their product.”

ELD concerns

The letter said feedback from producers and trucking operations indicates many ELDs on the market are not able to accommodate the agricultural exemption that is provided under the hours-of-service regulations. Under the agricultural exemption, hours-of-service regulations do not apply to the transportation of agricultural commodities operating within a 150-air mile radius of a pick-up.

“We believe that this extension would provide a reasonable period of time for FMCSA to work with the technology providers in developing a program to verify that the ELDs on the market can perform the tasks that the rule mandates and allow trucks hauling agricultural commodities to fully utilize the 150-mile exemption,” according to the letter.

The coalition is asking the agency to consider hours-of-service modifications to accommodate the realities of loading and unloading fresh produce.

“The unpredictability of loading and unloading times as it relates to fresh fruits and vegetables can significantly detract from the on-duty hours drivers are allowed in a day,” according to the letter, which notes that two-to four-hour delays at loading are not uncommon.

“We encourage FMCSA to consider flexibility under either the ELD rule or the hours-of-service rule for truck drivers who are idling, waiting or traveling small distances reflective of negotiating a congested terminal to be considered in an exempt status,” according to the letter. “We do not believe that this type of activity is as demanding as over-the-road driving and therefore should not contribute to maximum driving times.”

Allow packing facilities, cold storages and other locations to be considered as a “source” location under the hours-of-service regulation.

Allow the agricultural exemption’s 150-air-mile radius to begin at the final pick up point for multi-point pickups. Drivers make multiple pick-ups from small packinghouses or cold storage facilities to fill their load before continuing to final destinations. “We would encourage the 150 air-mile radius to begin at the location of the last pick-up point so as not to disrupt current supply chains and accommodate the operational efficiencies organically created by the marketplace over the last 100-plus years,” according to the letter.

Clearly define that empty trucks are covered under the agricultural exemption. According to the letter, agricultural exemptions should be clearly defined to include unladen trucks as eligible if they are traveling to a facility exclusively to pick up an order.

The revenue increase was fueled by 16% increases in both the number of loads and the total revenue per load. Rates rose rapidly during the year, contributing to the revenue increase. However, gross margins for the group dropped to an average of 13.7% from 14.8% in 2016, as costs increased faster than billings.

Total profit for the year also declined 11% compared to 2016, due largely to a few challenging months when expenses rose faster than revenues. Also, brokers tended to postpone profits from December to January, to take advantage of this year’s more favorable tax laws. That made December seem less profitable for the group, which had a big impact on quarterly results.

A Challenging but Successful Year, in Graphs

The selection of graphs below tell the story of a challenging but successful year. Brokers moved more loads in 2017, with higher revenue per load and higher revenue per employee. Costs rose faster than revenues, however, reducing profitability in some months and paring down gross margins for the year. The cost increase was associated primarily with rising spot market rates. Labor costs also grew throughout 2017.

Labor costs rose to 66% of net revenue in Q4 2016 and stayed in the 65% to 67% range for all of 2017. During the same period, non-labor expense declined from 29% to 22% as a portion of net revenue. The combination of the two put a squeeze on net operating profits, beginning in the fourth quarter of 2016, until profitability rebounded for the group in the second half of 2017.

Costs began to climb in Q4 2016, with labor expense leading non-labor expense, as brokerage companies in the group prepared to handle the revenue growth to come.

Revenue per employee held steady from Q4 2016 through Q2 2017, but average profit declined on a per-employee basis. The brokerages increased headcount during that period, to position their companies for additional growth.

Load counts increased 16% in 2017, including a 22% increase in the fourth quarter, compared to 2016. Steady, quarter-over-quarter growth in load counts began in Q1 2016 and accelerated in Q2 2017.

Revenue per load increased steadily in 2017, on both a year-over-year and a quarter-over-quarter basis, rising from an average of $1,226 per load in Q1 to $1,549 in Q4. Profits lagged during the period from Q4 2016 through Q2 2017, however, due to increased costs. From a $4.63 profit per load in Q1, the group’s average results improved to $22.42 per load in Q4. Profitability would likely have been higher in Q4, but many brokers moved profits to the new tax year.

Rapid increases in spot market freight rates led to margin compression for many freight brokers in 2017. Gross margins fell to 11% in January, due to extreme weather, then declined again to 13% from May through June, as rates began to rise sharply.

The DAT Broker Benchmark project analyzes revenues, expenses and profits, based on more than 25 key performance indicators available in DAT Keypoint, the transportation management system developed exclusively for freight brokers.

A system patented by Walmart aims to address one of the top drawbacks for would-be online shoppers: the desire to pick their own produce.

The “Fresh Online Experience,” a process Walmart outlined in a patent published Dec. 28, would allow consumers to remotely approve or reject specific produce items prepared for online orders. The service could be used for other fresh items as well.

When placing an order, consumers could select which items to confirm. Once two-dimensional or three-dimensional photos of the produce have been sent, the consumer has a set amount of time to approve or reject the items.

Walmart explained its rationale for the system — for which fulfillment could be manual or automated — in the background section of patent.

“A customer when visiting a retail store can inspect and choose produce that seems to look like the highest quality,” the company stated in the document. “However, a customer who orders the same item from a retail store website for grocery pickup and/or delivery has to rely on the store associate to choose the actual item to be delivered. They may be dissatisfied with the result.

“It is desirable for the customer to be able to request images of the item in the retail store, so that the customer can be satisfied with their online purchase,” Walmart stated.

The company has patented numerous other ideas over the years that have not been deployed. E-commerce, however, has been a major area of growth for Walmart, and inability to inspect produce and other fresh item is one of the most cited reasons people give for not grocery shopping online.

USF Career Services presents Spring 2018 Career Fair Week! Be sure to stop by and talk to employees of the official transportation provider of your USF Bulls athletics, ReedTMS Logistics! Each fair is a great way to network face-to-face with local and national employers interested in hiring USF students and graduates for full-time, co-op and internship positions.

Career Fair Week is sponsored in cooperation with the USF Alumni Association. Career Fair Week events are exclusively for USF students, with valid student ID, and alumni (please bring a current resume that includes your USF degree information).

WHY YOU SHOULD ATTEND

Meet in person with representatives from top organizations from around the country

Discuss employment openings with employers.

Distribute your resume so be sure to bring lots of copies!

Share your qualifications, skills, and academic background.

Network as you obtain company information and business cards of the organizations that interest you.

Responding to big demand, monthly average truck rates for refrigerated freight climbed again in December to reach an all-time high, according to the DAT Freight Index.

The monthly national averages for both dry and refrigerated (“reefer”) van rates were the highest of 2017, according to the index.

Spot truckload van rates averaged $2.11 per mile nationally, up 4 cents compared to November and the highest monthly average since DAT started tracking freight rates in 2010, according to the release.

The average reefer rate for December was $2.46 per mile, 3 cents higher than the November average and another all-time high, according to the release.

The availability of truckload freight in December was bolstered by retail shipments, demand for fresh and frozen foods, and e-commerce fulfillment, according to the release. Available truckload freight was 25% higher than in December 2016.

However, overall freight volume in December fell 3% compared to a strong November, according to the release. Some of the factors in that decline were inclement weather in parts of the U.S and the Dec. 18 electronic logging device mandate. That combination of strains on equipment and drivers meant that shippers and freight brokers paid premiums for available trucks, according to the release.

Tampa, Fla. (Jan. 17, 2018) – ReedTMS, a leading asset-based third party logistics provider announced its third annual carrier awards today. ReedTMS Logistics prides itself on successfully meeting and exceeding customer requirements and credits its success in large part due to the relationships it has built with a diverse group of carriers. Two decades of experience has helped to transform ReedTMS from a small startup venture to a leading organization within the logistics industry.

The following carriers are nominated by ReedTMS Logistics operations team members. Nominated service providers are then evaluated on a multitude of performance metrics that include: service quality and performance, on-time service, capacity and pricing, and overall commitment to the partnership.

The 2017 Flatbed Carrier of the year winner was presented to DP USA Trucking Inc

The 2017 Award of Excellence for Outstanding Flatbed Service was presented to JJB Logistics Inc

The 2017 Dry Van Carrier of the year was presented to R & R Elite Trucking

The 2017 Award of Excellence for Outstanding Dry Van Service was presented to Bridgestone America’s Fleet Operations

The 2017 Refrigerated Van Service winner was presented to CALIFORNIA EXPRESS LINES LLC

The 2017 Award of Excellence for Outstanding Refrigerated Van Service was presented to Darngavil Enterprises LLC

“It brings us great pleasure to recognize some of our carrier partners who exemplify what it means to go above and beyond in an industry as diverse as ours,” said Jason Reed, CEO of ReedTMS Logistics. “The continued success of our business is reliant on great relationships like the ones we have forged with these terrific companies.”

ReedTMS Logistics supports its more than 25,000 carriers with high volume and quality truck loads, timely payment, an in-depth understanding of their business, ease of doing business and most importantly a customer-centric operations staff.

About ReedTMS Logistics
Established in 2010, ReedTMS Logistics is an asset-based third-party logistics provider compromised of Reed Transport Services, Inc. and TMS Logistics, Inc. The two companies offer a wide array of transportation services to customers throughout the United States, Canada and Mexico. Headquartered in Tampa, Fla. with offices in Cedar Grove, Wisconsin and Ashland, Ohio. Founded in 1996, Reed Transport offers high-quality brokerage and freight management services. Founded in 1997, TMS Logistics is a multimode carrier specializing in dry van, dedicated fleet services. For more information, visit www.ReedTMS.com